Page 1 of 49

To be published in the Gazette of India, Extraordinary, Part 1 Section 1

F. No. 14/50/2016-DGAD

Government of India

MINISTRY OF COMMERCE & INDUSTRY

DEPARTMENT OF COMMERCE

(DIRECTORATE GENERAL OF ANTI-DUMPING & ALLIED DUTIES)

4th Floor Jeevan Tara Building, 5, Parliament Street, New Delhi-110001

Dated 16th April, 2018

NOTIFICATION

FINAL FINDINGS

Subject: Anti-dumping investigation concerning imports of ‘Acrylic Fibre’,

originating in or exported from China PR, Belarus, Ukraine, EU and Peru.

No. 14/50/2016-DGAD: Having regard to the Customs Tariff Act, 1975, as

amended from time to time (hereinafter referred to as the Act) and the Customs

Tariff (Identification, Assessment and Collection of Anti-Dumping Duty on

Dumped Articles and for Determination of Injury) Rules thereof, as amended from

time to time (hereinafter referred to as the AD rules) thereof M/s Indian Acrylics

Ltd. and M/s Pasupati Acrylon Ltd. (hereinafter also referred to as “the Petitioners”

or “the Domestic Industry”) have filed an application before the Designated

Authority (hereinafter also referred to as “the Authority”) in accordance with the

Act and the AD Rules, for initiation of anti-dumping investigation concerning

imports of “Acrylic Fibre” (also referred to as “the subject goods”), originating in

or exported from China PR, Belarus, Ukraine, EU and Peru (also referred to as “the

subject countries”) and requested for levy of anti-dumping duties on the subject

goods.

2. Whereas, the Authority, on the basis of prima facie evidence submitted by the

Petitioners, issued a public notice vide Notification No. 14/50/2016 -DGAD dated

19th April, 2017 published in the Gazette of India, Extraordinary, initiating the

subject investigations in accordance with the Rule 6(1) of the Rules to determine

the existence, degree and effect of the alleged dumping of the subject goods,

originating in or exported from the subject countries, and to recommend the amount

of anti-dumping duty, which, if levied, would be adequate to remove the alleged

injury to the domestic industry.

A. PROCEDURE

3. The procedure described herein below has been followed by the Authority

Page 2 of 49

with regard to this subject investigation:

i. The Authority notified the embassies of the subject countries in India about

the receipt of the present anti-dumping application before proceeding to

initiate the investigations in accordance with sub-rule 5(5) of the AD Rules.

ii. The Authority issued a Notification dated 19th April, 2017, published in the

Gazette of India Extraordinary, initiating anti-dumping investigation

concerning imports of the subject goods from the subject countries.

iii. The Authority sent a copy of the initiation notification to the embassies of

the subject countries in India, known producers/exporters from the subject

countries, known importers/users and the domestic industry as well as other

domestic producers as per the addresses made available by the applicant and

requested them to make their views known in writing within 40 days of the

initiation notification in accordance with Rule 6(2) of the AD Rules.

iv. The Authority provided a copy of the non-confidential version of the

application to the known producers/exporters, known importers and to the

embassies of the subject countries in India in accordance with Rule 6(3) of

the AD Rules.

v. The Authority sent exporter’s questionnaire to the following known

producers/exporters in the subject countries, whose details were made

available by the applicant, to elicit relevant information in accordance with

Rule 6(4) of the Rules:

a. Montefibre Spa, Italy (EU)

b. International Rayon and Synthetic Fibres Committee, Belgium

c. Acordis AG, Germany

d. Dralon GmbH, Germany

e. Markische Faser AG, Germany

f. International Rayon and Synthetic Fibres Committee, Belgium

g. Acordis UK Ltd.

h. Neftokhim Petrochemical Complex, Bulgaria

i. LUKOIL Company, Bulgaria

j. JSC POLYMIR, Belarus

k. Anqing Petrochemical, China PR

l. Pumica Trading Corpn Ltd., Latvia

m. Jilin Qifeng Chemical Fiber Co. Ltd., China PR

n. Jilin Jimont Acrylic Fiber Co. Ltd., China PR

o. Shanghai Petrochemical, China PR

p. Qilu Petrochemical, China PR

q. Sudamericana de Fibras S.A, Peru

Page 3 of 49

vi. The Embassies of the subject countries in India were also requested to advise

the exporters/producers from the subject countries to respond to the

questionnaire within the prescribed time limit. A copy of the letter and

questionnaire sent to the producers/exporters was also sent to them along

with the names and addresses of the known producers/exporters from the

subject countries.

vii. The following producers/exporters from the subject countries filed exporter’s

questionnaire response in the prescribed format:

a. Sudamericana de Fibras S.A (Producer) – Peru

b. Jilin Qifeng Chemical Fiber Co. Ltd. (Producer/Exporter)– China PR

c. Sinopec Shanghai Petrochemical Co. Ltd. (Producer) – China PR

d. China Jinshan Associated Trading Corporation(Exporter)– China PR

e. Dralon GmbH, Germany (Producer/Exporter) – European Union

f. Open Joint-Stock Copany Naftan (Producer/Exporter)-Belarus

viii. The Authority forwarded a copy of the Initiation Notification to the

following known importers/users/user associations, whose names and

addresses were made available to the Authority, of subject goods in India

and advised them to make their views known in writing within the time limit

prescribed by the Authority in accordance with the Rule 6(4):

a. Rajasthan Spinning & Weaving Mills Ltd., New Delhi

b. Vardhaman Spinning & General Mills, Ludhiana

c. Deepak Spinners Ltd., Chandigarh

d. Malwa Cotton Spinning Mills Ltd., Ludhiana

e. Shiwaliya Spg. & Wvg. Mills (P) Ltd., Ludhiana

f. Deepak Spinners Ltd. Solan Baddi

g. Shiva Fabricator (P) Ltd., Ludhiana

h. Supreme Tex Mart Ltd., Ludhiana

i. Yogendra Worsted Ltd., Ludhiana

j. Shree Rajasthan Syntex Ltd, Dungarpur

k. Banswara Syntex Ltd., Banswara

l. Ganga Acrowools Ltd., Ludhiana

m. Shital Fibres Ltd., Jalandhar

n. Arisudana Industries Ltd., Ludhiana

o. Sportking India Ltd., Ludhiana

p. Texas Woollen Mills (P) Ltd., Ludhiana

q. Jindal Cotex Ltd., Ludhiana

r. Garg Acrylics Ltd., Ludhiana

s. Indian Spinners’ Association, Mumbai

t. Ludhiana Spinners Association, Ludhiana

Page 4 of 49

ix. The following importers or consumers of the product have filed the

importer’s questionnaire response in the prescribed format:

a. Ganga Spinning and Weaving Mills Ltd.

b. Banswara Syntex Ltd., Banswara

c. Vanaik Spinning Mills Ltd.

x. Submissions/ comments were filed by following parties during the course of

the investigation :

1. Delegation of the European Union to India and Bhutan

2. Embassy of the Republic of Belarus, Embassy of Ukraine

3. Embassy of Peru

4. Dralon GmbH, Germany

5. Jilin Qifeng Chemical Fiber Co. Ltd., Sinopec Shanghai

Petrochemical Co. Ltd. and China Jinshan Associated Trading

Corporation from China PR

6. Sudamericana de Fibras S.A (Peru)

7. Open Joint-Stock Copany Naftan Belarus

8. Indian Spinner Association, Punjab Spinners Association, Supreme

NonWoven India Pvt. Ltd, Ganga Spinning and Weaving Mills Ltd,

Ganga Acrowools Ltd, Banswara Syntex Ltd., and Vanaik Spinning

Mills Ltd.

xi. The Authority made available non-confidential version of the evidence

presented by various interested parties in the form of a public file, kept open

for inspection by the interested parties as per Rule 6(7). Submissions made

by all interested parties have been taken into account in the present

disclosure statement.

xii. The Period of Investigation for the purpose of the present investigation has

been considered from April 2016 – March 2017 (12 Months). The injury

investigation period has been considered as the period April 2013 - March

2014, April 2014 - March 2015, April 2015 - March 2016 and the POI.

xiii. Additional/supplementary information was sought from the applicant and

other interested parties to the extent deemed necessary. Verification of the

data provided by the domestic industry and exporters/producers was

conducted to the extent considered necessary for the purpose of the

investigation.

xiv. The Non-Injurious Price (NIP) is based on the cost of production and cost to

make and sell the subject goods in India based on the information furnished

Page 5 of 49

by the domestic industry on the basis of Generally Accepted Accounting

Principles (GAAP) and Annexure III to the AD Rules. It has been worked

out so as to ascertain whether Anti-Dumping duty lower than the dumping

margin would be sufficient to remove injury to the Domestic Industry.

xv. Information provided by the Directorate General of Commercial Intelligence

and Statistics (DGCI&S) on transaction-wise basis for the past three years,

and the period of investigation has been adopted for determination of

volume and value of imports of product concerned in India.

xvi. The Authority held an oral hearing on 12th March, 2018 to provide an

opportunity to the interested parties to present relevant information orally in

accordance to Rule 6(6) of AD Rules. All the interested parties who

presented their views orally at the time of hearing were advised to file

written submissions of the views expressed orally. The interested parties

were also provided opportunity to offer rejoinder submissions to the

submissions made by opposing interested parties.

xvii. The submissions made by the interested parties during the course of this

investigation, wherever found relevant, have been addressed by the

Authority, in this disclosure statement.

xviii. Information provided by the interested parties on confidential basis was

examined with regard to sufficiency of the confidentiality claim. On being

satisfied, the Authority has accepted the confidentiality claims wherever

warranted and such information has been considered as confidential and not

disclosed to other interested parties. Wherever possible, parties providing

information on confidential basis were directed to provide sufficient non-

confidential version of the information filed on confidential basis.

xix. Wherever an interested party has refused access to, or has otherwise not

provided necessary information during the course of the present

investigation, or has significantly impeded the investigation, the Authority

has considered such parties as non-cooperative and recorded this disclosure

statement on the basis of the facts available.

xx. The Authority issued a disclosure statement under Rule 16 on 27th March,

2018 and provided an opportunity to give comments to the disclosure

statement till 4th April, 2018.

xxi. In this final findings, *** represents information furnished by an interested

party on confidential basis, and so considered by the Authority under the

Rules.

Page 6 of 49

xxii. The exchange rate adopted by the Authority during the POI for the subject

investigations is 1 US$= Rs 67.95.

B. PRODUCT UNDER CONSIDERATION AND LIKE ARTICLE

4. The product under consideration for the purpose of present investigation is

“Acrylic Fibre” (also referred to as “subject goods”).

B.1. Submissions made by Domestic industry

5. The domestic industry has submitted as follows with regard to product under

consideration and like article:

a. Acrylic Fibre is a long chain of synthetic polymer composed of at least 90%

by weight of Acrylonitrile units (major raw material for production). The

term Acrylic Fibre includes acrylic staple fibre, acrylic tow, and acrylic top,

all of which are known as Acrylic Fibre in commercial parlance. The only

difference between acrylic staple fibre and acrylic tow is the difference in

length. In case of length more than 2 meters, it is known as tow and in case

of cut lengths, it is known as staple fibre. All forms of acrylic fibre are

within the scope of the product under consideration.

b. Acrylic Fibre is lightweight, soft and warm with wool-like feel. It is very

resilient and shows high resistance to acids and alkalies compared to other

synthetics and natural fibres. Some varieties of acrylic fibre are used as less

expensive alternative to cashmere wool due to the similar feeling of the

materials. Acrylic Fibre is an economical substitute of wool. Acrylic fibre

takes colour well, is washable, and is generally hypoallergenic.

c. Acrylic Fibre is classified under chapter 55 of the Customs Tariff Act under

the sub-heading 5501, 5503 and 5506 at 4-digit level. The product is

covered under HS code 550130, 550330 and 550630 at six-digit levels and

under 55013000 and 55033000 at eight-digit levels.

d. Acrylic Fibre has application in day-to-day human life. Acrylic Fibre has

variety of applications in apparel, household and industrial areas.

e. Acrylic Fibre falls under Chapter 55 of the Customs Tariff Act under the

category "Man Made Staple Fibres".

f. Acrylic Fibres produced by the domestic industry should be treated as like

article to the Acrylic Fibre imported from the subject countries in

accordance with the Anti-dumping Rules.

Page 7 of 49

B.2 Submissions made by other interested parties

6. The following submissions are made by other interested parties:

i. The PUC should not cover lower quality grades or second grades as they are

inferior in technical characteristics and by definition do not meet the

technical criteria to be classified as the product under consideration.

ii. It has been submitted by M/s Supreme Nonwoven that Homo Polymer

Acrylic Fibre being a speciality fibre having superior properties should be

exempted from the proposed anti-dumping duty. They have further stated

that there is no producer of Homo Polymer Acrylic Fibre in India and that

this product was excluded in previous antidumping investigations in

notifications issued in August 2002 and 20th November 2008.

B.3. Examination by the Authority

7. The product under consideration is Acrylic Fibre. Acrylic Fibre is a long chain

of synthetic polymer composed of at least 90% by weight of Acrylonitrile units

(major raw material for production). The term Acrylic Fibre includes acrylic staple

fibre, acrylic tow and acrylic top, all of which are known as Acrylic Fibre in

commercial parlance. The only difference between acrylic staple fibre and acrylic

tow is the difference in length. In case of length more than 2 meters, it is known as

tow and in case of cut lengths, it is known as staple fibre. All forms of acrylic fibre

are within the scope of the product under consideration.

8. Acrylic Fibre is lightweight, soft, and warm, with a wool-like feel. Its fibres

are very resilient and shows high resistance to acids and alkalies compared to both

other synthetics and natural fibres. Acrylic Fibre is an economical substitute of

wool.

9. Acrylic Fibre is classified under chapter 55 of the Customs Tariff Act under

the sub-heading 5501, 5503 and 5506 at 4-digit level. The product is covered under

under HS code 550130, 550330 and 550630. However, the customs classification is

indicative only and in no way binding upon the product scope.

10. With regard to the issue of lower quality or second grades, the Authority notes

that product cannot be excluded from the scope of the investigation merely on the

quality grounds. Further, interested parties have not provided any evidence to

demonstrate that these lower quality grades are not competing with the like article

manufactured by the domestic industry. Therefore, Authority determines not to

exclude these grades.

Page 8 of 49

11. It is an admitted fact that the domestic industry does not manufacture

Homopolymer Acrylic Fibre containing 100% Acrylonitrile. A letter from M/s

Pasupati Acrylon Ltd. mentioning that they do not produce Homo Polymer Acrylic

Staple Fibre too has been furnished. Therefore, the Authority determines to

exclude “Homo Polymer Acrylic Fibre containing 100% Acrylonitrile” from the

purview of the product under consideration.

12. After considering the information on record, the Authority holds that there is

no known difference in the subject goods produced by the Indian industry and that

exported from the subject countries. Subject goods produced by the Petitioners and

that imported from the subject countries are comparable, in terms of product

characteristics such as physical & chemical characteristics, manufacturing process

& technology, functions & uses, product specifications, pricing, distribution &

marketing and tariff classification of the goods. Acrylic Fibre produced by the

Domestic Industry is technically and commercially substitutable to the imported

Acrylic Fibre. The Authority holds that the product under consideration produced

by the applicant domestic industry is like article to the subject product under

consideration imported from the subject countries. However, the Authority

determines to exclude “Homo Polymer Acrylic Fibre containing 100%

Acrylonitrile” from the purview of the product under consideration.

C. SCOPE OF DOMESTIC INDUSTRY & STANDING

13. Rule 2(b) of the AD rules defines domestic industry as under:

“(b) “domestic industry” means the domestic producers as a whole

engaged in the manufacture of the like article and any activity connected

therewith or those whose collective output of the said article constitutes a

major proportion of the total domestic production of that article except

when such producers are related to the exporters or importers of the alleged

dumped article or are themselves importers thereof in such case the term,

‘domestic industry’ may be construed as referring to the rest of the

producers.”

C.1. Submissions made by the Domestic industry

14. Submissions made by the domestic industry in this regard are as follows:

a. The Petition has been filed by M/s Indian Acrylics Ltd. and M/s Pasupati

Acrylon Ltd.

b. There is one other producer of the subject goods in India namely Vardhman

Acrylics Ltd. Vardhman Acrylics Ltd. has imported significant volumes of

subject goods from the Europe.

Page 9 of 49

c. Production of the Petitioners constitutes 78% of Indian production of the

product under consideration.

d. One of the Petitioners, Indian Acrylics Ltd., has imported the subject goods

from Thailand under advance licenses against exports during the injury

period.

e. Petitioners are not related (either directly or indirectly) to any exporter or

importer of product under consideration within the meaning of Rule 2(b).

f. While Petitioners are not importers of the product under consideration from

subject countries, Vardhman Acrylics Ltd. is a regular importer of product

under consideration from the EU. Imports made by Vardhman Acrylics Ltd.

are quite significant and are not for self-consumption. Petitioners have the

standing whether Vardhman Acrylics is considered as an eligible or

ineligible constituent of the domestic industry in view of its imports.

C.2. Submissions made by other interested parties

15. No submissions have been made by any of the interested parties in this regard.

C.3. Examination by the Authority

16. The present application has been filed by M/s Indian Acrylics Ltd. and M/s

Pasupati Acrylon Ltd. as the domestic producers of the product under

consideration.

17. The Authority notes that the Petitioners are two of the three main producers of

the subject goods in India. Production of the Petitioners constitutes 78% of Indian

production of the product under consideration.

18. In view of the above facts, the Authority holds that the Petitioners constitute

Domestic Industry in terms of Rule 2(b) of the AD Rules and satisfy the standing

requirement in terms of Rule 5(3) of the AD Rules.

D. CONFIDENTIALITY

D.1. Submissions made by the Domestic industry

19. Submissions made by the domestic industry in this regard are as follows:

a. Though one of the producers from Peru has filed the questionnaire response,

the Petitioners are unable to make any comments on the same in view of

excessive confidentiality claimed by the Peruvian producer.

Page 10 of 49

D.2. Submissions made by the other interested parties

20. Submissions made by other interested parties in this regard are as follows:

a. Petitioners have not provided good cause statement as required under para

2.ii of Trade Notice No. 1/2009 in claiming confidentiality in respect of

captive and export sales volume.

b. Petitioners have claimed excessive confidentiality in respect of captive and

exports sales volume without providing any basis for doing so.

c. While volumes of both exports and captive sales have been mentioned in the

original Petition, they have been claimed as confidential in the updated

Annexures. The domestic industry has not provided indexed figures also

against these parameters, and has resorted to such misuse of confidentiality.

D.3. Examination by the Authority

21. With regard to confidentiality of information, Rule 7 of Anti-dumping Rules

provides as follows:

“7. Confidential information- (1) Notwithstanding anything contained in sub rules

(2), (3) and (7) of rule 6, sub-rule (2) of rule 12, sub-rule (4) of rule 15 and sub-

rule (4) of rule 17, the copies of applications received under sub-rule (1) of rule 5,

or any other information provided to the designated Authority on a confidential

basis by any party in the course of investigation, shall, upon the designated

Authority being satisfied as to its confidentiality, be treated as such by it and no

such information shall be disclosed to any other party without specific

authorization of the party providing such information.

(2)The designated Authority may require the parties providing information on

confidential basis to furnish non-confidential summary thereof and if, in the opinion

of a party providing such information, such information is not susceptible of

summary, such party may submit to the designated Authority a statement of reasons

why summarization is not possible.

(3) Notwithstanding anything contained in sub-rule (2), if the designated Authority

is satisfied that the request for confidentiality is not warranted or the supplier of the

information is either unwilling to make the information public or to authorise its

disclosure in a generalized or summary form, it may disregard such information.”

22. Information provided by the domestic industry as well as other interested

parties on confidential basis was examined with regard to sufficiency of the

confidentiality claim. On being satisfied, the Authority has accepted the

confidentiality claims, wherever warranted and such information has been

considered confidential and not disclosed to the other interested parties.

Page 11 of 49

E. MISCELLANEOUS ISSUES

E.1. Submissions made by the Domestic industry

23. Submissions made by the domestic industry in this regard are as follows:

a. Exporters from more than one country are dumping the subject goods in the

Indian market. In terms of the provisions under Annexure II(iii) of the AD

Rules, in case imports of a product from more than one country are being

simultaneously subjected to anti-dumping investigations, the Authority

should cumulatively assess the effect of such imports.

b. Export price from the subject countries significantly differs in terms of

customer and time period and therefore it is a fit case where weighted

average normal value cannot be compared with weighted average export

price. The Authority is requested to consider weighted average normal value

and compare with individual export price and in all those import

transactions where the dumping margin is negative, the same may be

excluded for determination of dumping margin.

c. Ukrainian imports should not be excluded from the scope of the

investigation as it is well settled law that the injury analysis is undertaken

considering the POI. The previous years are taken into account only to make

a comparative analysis.

d. Duties have to be imposed as and when there are instances of dumping

activities. None of the interested parties have established how the

imposition of duties will impact the downstream users.

E.2. Submissions made by other interested parties

24. Submissions made by other interested parties in this regard are as follows:

a. Imports from Belarus were only 2.94% of the total imports to India during

the POI as per the petition. It has been rounded off to 3% at certain places

in the Petition. Investigation against Belarus is bad in law and should be

terminated immediately.

Page 12 of 49

b. Taiwan has been kept out of the scope of the present investigation. This is

discriminatory and also frustrates the entire causal link analysis of injury.

This situation also warrants termination of the present investigation in view

of Rule 5(3).

c. The data with regard to capacity and ability to raise capital investments

submitted by the Domestic Industry in their Petition differs from and is

contrary to the data in their Annual Reports.

d. Conditions of inter-se competition between the subject goods imported into

India and the conditions of competition between the subject goods imported

into India and the like domestic product are not the same. Therefore a

cumulative assessment would not be appropriate.

e. The requirement for the Authority to conduct cumulative assessment stands

vitiated on the fact that Taiwan is not included in the scope of subject

countries and share of Belarus was below 3% in total imports at the time of

initiation. Such being the case, any cumulative assessment shall only lead to

distorted conclusions and a country wise examination including Taiwan

should be done in the present case.

f. The end-user industry is already reeling under margin pressures, and the

prices offered by the domestic industry are not competitive. In the interest

of these end-users, the domestic industry should not recommend any anti-

dumping duty as it will lead to the closure of a large number of small scale

users of the product under consideration.

g. Imports from the European Union should not be included in the cumulative

assessment of the effect of imports since the landed value of the product

under consideration from the EU is the highest, the market share of imports

from the EU has declined in the POI, and volume of imports from the EU

has declined in the POI.

h. In almost every anti-dumping investigation initiated since 1996, anti-

dumping duties have been recommended and levied on imports of Acrylic

Fibre, some of which are still in place. Thus the domestic producers of

Acrylic Fibre have had more than adequate protection from imports vide

anti-dumping duties.

i. In the context that a lot of specialty grades have been imported, a PCN wise

comparison may be made to ensure fairness in determination of dumping

and injury margin. The product here involves multiple grades and types and

at the best a PCN analysis is appropriate.

Page 13 of 49

E.3. Examination by the Authority

25. With regard to the various issues raised by the domestic industry and the other

interested parties, the Authority notes as follows:

a. With regard to the issue of imports from Belarus, the Authority notes that

the actual volume of imports of the product under consideration from

Belarus during the POI is more than 3% of the volume of all imports of the

product under consideration. Therefore, there is no merit in the submission

that the investigation against Belarus should be terminated in accordance

with the AD Rules.

b. With regard to the inclusion of Taiwan in the scope of investigations, the

Authority notes that no arguments have been advanced or evidence

produced to show that imports of the product under consideration from

Taiwan are being dumped into India. Hence, there is no requirement to

include Taiwan within the scope of this investigation.

F. MARKET ECONOMY TREATMENT (MET), NORMAL VALUE,

EXPORT PRICE AND DUMPING MARGIN

Normal Value

26. Under Section 9A(1)(c) of the Customs Tariff Act, 1975, as amended, the

normal value in relation to an article means:-

i. the comparable price, in the ordinary course of trade, for the like article when

meant for consumption in the exporting country or territory as determined in

accordance with the rules made under sub-section (6); or

ii. When there are no sales of the like articles in the ordinary course of trade in the

domestic market of the exporting country or territory, or when because of the

particular market situation or low volume of the sales in the domestic market of

the exporting country or territory, such sales do not permit a proper

comparison, the normal value shall be either-

a. Comparable representative price of the like article when exported from the

exporting country or territory to an appropriate third country as

determined in accordance with the rules made under sub-section (6); or

b. the cost of production of the said article in the country of origin along with

reasonable addition for administrative, selling and general costs, and for

profits, as determined in accordance with the rules made under sub-section

(6):

Page 14 of 49

Provided that in the case of import of the article from a country other than the

country of origin and where the article has been merely transhipped through

the country of export or such article is not produced in the country of export or

there is no comparable price in the country of export, the normal value shall be

determined with reference to its price in the country of origin.

F.1. Submissions by the Domestic industry

27. Submissions made by the domestic industry in this regard are as follows:

a. One of the provisions of China PR’s Accession Protocol has expired on

11th December, 2016. The Designated Authority may consider Chinese

producers as producers operating in non-market economy conditions for the

following reasons:

i. The investigation period proposed by the Petitioners in the present

case is Jul 2016 to December 2016 (6 months). The injury

investigation period has been proposed as the period 2013-14, 2014-

15, 2015-16, April-June 2016, and the POI.

ii. The Chinese producers are required to be treated as non-market

economy companies for the reasons that the costs and prices in China

do not reasonably reflect the market forces.

iii. Chinese producers are required to be treated as non-market economy

companies till such time the investigation period includes the period

specified in China’s Accession Protocol.

b. China PR had agreed to be considered as non-market economy upto 11th

December 2016, as per the Accession Protocol. Technically, China PR held

NME status during the proposed injury period as well as the POI proposed

in the present case. Therefore, there should be no change in the status of

China PR in this investigation.

c. Normal value in China PR, Belarus and Ukraine – Since they are non-

market economies, the Authority should follow para 7 of Annexure I of the

AD Rules.

d. None of the exporters from Ukraine and Belarus have responded to the

Exporters Questionnaire. Thus the normal value of these countries should be

determined in accordance with the written submissions filed by the

Petitioners and as per best available information.

Page 15 of 49

e. Petitioners have claimed determination of normal value in China PR,

Belarus and Ukraine on the basis of regional prices of Acrylic Fibre

prevailing in Asia (Far East) Region as per IHS Chemical reports for the

proposed POI on CFR basis. The Authority may kindly apply ordinary

course of trade test on these prices and ascertain that these prices are above

full cost of production.

f. Petitioners have been able to get evidence of delivered basis prices

prevailing in West Europe region as per IHS Chemical reports and have

adopted these prices as the basis for the normal value for the proposed POI.

The Authority may kindly apply ordinary course of trade test on these prices

and ascertain that these prices are above full cost of production.

g. Petitioners have been able to get evidence of delivered basis prices

prevailing in South America regions as per IHS Chemical reports and have

adopted these prices as the basis for the normal value for the proposed POI.

The Authority may kindly apply ordinary course of trade test on these prices

and ascertain that these prices are above full cost of production.

h. All those import transactions where the dumping margin is negative should

be excluded for determination of dumping margin.

F.2. Submissions made by other interested parties

28. Submissions made by the foreign producers/exporters/other interested parties

with regard to normal value are as under:

a. The Authority should determine dumping margin by calculating the normal

value and export price based on the Questionnaire response filed by the

Exporters.

b. Ukraine should be treated as Market Economy Country. India has already

recognised Ukraine as market economy in cold rolled coils investigation.

c. The export prices of Acrylic Fibre by OJSC Naftan are higher than the

domestic selling prices of Acrylic Fibre in Belarus in the POI.

d. The Republic of Belarus is a state with market economy. The Govt. of India

has recognized Belarus as a market economy during the visit of President

Mukherjee to Belarus in 2015.

Page 16 of 49

e. The exclusion of those transactions where the dumping margin is negative

is a methodology known as zeroing which has been conclusively deemed to

be inconsistent and in violation of the AD Agreement and the AD Rules.

F.3. Examination by the Authority

29. The following producers/exporters from the subject countries have filed

exporter’s questionnaire:

a. Sudamericana de Fibras S.A (Producer) – Peru

b. Jilin Qifeng Chemical Fiber Co. Ltd. (Producer/Exporter)– China

PR

c. Sinopec Shanghai Petrochemical Co. Ltd. (Producer) – China PR

d. China Jinshan Associated Trading Corporation(Exporter)– China PR

e. Dralon GmbH, Germany (Producer/Exporter) – European Union

f. Open Joint-Stock Company Naftan , Belarus

a) Examination of Market Economy Claims and Normal Value

30. Article 15 of China’s Accession Protocol provides as follows:

“Article VI of the GATT 1994, the Agreement on Implementation of Article VI of

the General Agreement on Tariffs and Trade 1994 ("Anti-Dumping Agreement")

and the SCM Agreement shall apply in proceedings involving imports of Chinese

origin into a WTO Member consistent with the following:

(a) In determining price comparability under Article VI of the GATT 1994 and the

Anti-Dumping Agreement, the importing WTO Member shall use either Chinese

prices or costs for the industry under investigation or a methodology that is not

based on a strict comparison with domestic prices or costs in China based on the

following rules:

(i) If the producers under investigation can clearly show that market economy

conditions prevail in the industry producing the like product with regard to the

manufacture, production and sale of that product, the importing WTO Member

shall use Chinese prices or costs for the industry under investigation in

determining price comparability;

(ii) The importing WTO Member may use a methodology that is not based on a

strict comparison with domestic prices or costs in China if the producers under

investigation cannot clearly show that market economy conditions prevail in the

industry producing the like product with regard to manufacture, production and

sale of that product.

(b)In proceedings under Parts II, III and V of the SCM Agreement, when

addressing subsidies described in Articles 14(a), 14(b), 14(c) and 14(d), relevant

provisions of the SC M Agreement shall apply; however, if there are special

Page 17 of 49

difficulties in that application, the importing WTO Member may then use

methodologies for identifying and measuring the subsidy benefit which take into

account the possibility that prevailing terms and conditions in China may not

always be available as appropriate benchmarks. In applying such methodologies,

where practicable, the importing WTO Member should adjust such prevailing

terms and conditions before considering the use of terms and conditions prevailing

outside China.

(c) The importing WTO Member shall notify methodologies used in accordance

with subparagraph (a) to the Committee on Anti-Dumping Practices and shall

notify methodologies used in accordance with subparagraph (b) to the Committee

on Subsidies and Countervailing Measures.

(d)Once China has established, under the national law of the importing WTO

Member, that it is a market economy, the provisions of subparagraph (a) shall be

terminated provided that the importing Member's national law contains market

economy criteria as of the date of accession. In any event, the provisions of

subparagraph (a)(ii) shall expire 15 years after the date of accession. In addition,

should China establish, pursuant to the national law of the importing WTO

Member, that market economy conditions prevail in a particular industry or sector,

the non-market economy provisions of subparagraph (a) shall no longer apply to

that industry or sector.”

31. Article 15 implies that provisions of one of the sub-paragraph shall expire 15

years from date of China’s Accession. The provisions of this sub-paragraph expired

on 11th Dec., 2016. Since the factum of dumping causing injury to the domestic

industry is established based on investigation period, the conditions prevalent

during the investigation period alone is relevant, appropriate and necessary for the

purpose of present investigation. The Period of Investigation (POI) for the purpose

of the present review is April 2016 to March 2017. Since the subparagraph of

Article 15 was in existence during the period of investigation, the Authority is

entitled to use a methodology that is not based on a strict comparison with domestic

prices or costs in China if the producers under investigation cannot clearly show

that market economy conditions prevail in the industry producing the like product

with regard to manufacture, production and sale of that product.

32. The Authority notes that in the past three years China PR has been treated as a

non-market economy country in anti-dumping investigations by India and other

WTO Members. China PR has been treated as a non-market economy country

subject to rebuttal of the presumption by the exporting country or individual

exporters in terms of the Rules.

33. As per Paragraph 8, Annexure I to the AD Rules as amended, the presumption

of a non-market economy can be rebutted if the exporter(s) from China PR provides

information and sufficient evidence on the basis of the criteria specified in sub-

paragraph (3) in Paragraph 8. The cooperating exporters/producers of the subject

Page 18 of 49

goods from People's Republic of China are required to furnish necessary

information/sufficient evidence as mentioned in sub-paragraph (3) of paragraph 8 in

response to the Market Economy Treatment questionnaire to enable the Designated

Authority to consider the following criteria as to whether:

a. The decisions of concerned firms in China PR regarding prices, costs and

inputs, including raw materials, cost of technology and labour, output,

sales and investment are made in response to market signals reflecting

supply and demand and without significant State interference in this

regard, and whether costs of major inputs substantially reflect market

values.

b. The production costs and financial situation of such firms are subject to

significant distortions carried over from the former non-market economy

system, in particular in relation to depreciation of assets, other write-offs,

barter trade and payment via compensation of debts.

c. Such firms are subject to bankruptcy and property laws which guarantee

legal certainty and stability for the operation of the firms.

d. The exchange rate conversions are carried out at the market rate.

Determination of Normal Value for producers and exporters in China PR

34. None of the exporters/producers from China PR have claimed market

economy status. In the absence of any reliable price and cost details for the subject

goods in any market economy third country, the normal value for China PR has

been constructed considering optimum cost and consumption norms of the most

efficient constituent of the domestic industry plus reasonable profit. The normal

value so determined is provided in the Dumping Margin Table herein below.

Determination of Normal Value for producers and exporters in Belarus

35. Normal value for cooperating producer/exporter from Belarus is determined

on the basis of information provided by the concerned producer/exporter as Belarus

has been treated as market economy by the Government of India, which was

conveyed to the Embassy of the Republic of Belarus vide letter no. 11/1/2013-

FT(CIS) dated 10.06.2015 from the Department of Commerce, Ministry of

Commerce and Industry, Government of India.

Open Joint-Stock Company Naftan (Belarus)

Page 19 of 49

36. In view of questionnaire response from the producers/exporters in Belarus,

normal value and dumping margin in case of responding producers and exporters

has been determined on the basis of their questionnaire response.

37. From the Exporter Questionnaire response, the Authority notes that M/s

Naftan, is a producer/exporter of the subject goods. As per information available in

the exporter’s questionnaire response, during the period of investigation, Naftan

made *** MT domestic sales to unrelated customers. The ordinary course of trade

(80:20) test conducted on the sales indicates that *** % of sales were profitable.

The normal value of the subject goods in the POI therefore has been determined by

taking average price of the profitable domestic sales in the subject country. No

adjustments has been claimed from normal value by the company. The normal

value is thus considered as *** USD/MT.

Determination of Normal Value for producers and exporters in Ukraine

38. The Authority notes that none of the producers/exporters from Ukraine have

filed exporter questionnaire response. In view of non-cooperation from all the

producer-exporters in Ukraine, the Authority has determined normal value on the

basis of best available information in terms of Rule 6(8) and the same is indicated

in the dumping margin table given below.

Determination of Normal Value for producer/exporters from European Union

Dralon GmbH, Germany (Exporter/Producer)

39. From the Exporter Questionnaire (EQ) response, the Authority notes that

Dralon GmbH is a producer and exporter of the subject goods. Dralon has claimed

normal value on the basis of sales made in the domestic market. As per information

available in the EQ response, during the period of investigation Dralon made ***

MT of domestic sales to unrelated customers. The ordinary course of trade (80:20)

test conducted on the sales of Dralon indicates that ***% of the domestic sales are

profitable. Therefore, normal value of the subject goods in the POI has been

determined by taking average price of the profitable domestic sales in the subject

country. Dralon has claimed adjustments on account of inland freight, packing cost,

commission and credit cost. Authority has allowed the same after due verification

and normal value is thus arrived as *** USD/MT.

Determination of Normal Value for producers and exporters in Peru

Sudamericana de Fibras S.A, Peru (Producer)

40. The Authority notes that Sudamericana de Fibras S.A from Peru has filed

exporter questionnaire response.

Page 20 of 49

41. From the Exporter Questionnaire (EQ) response, the Authority notes that

Sudamericana de Fibras, Peru is a producer of the subject goods. Sudamericana de

Fibras has claimed normal value on the basis of sales made in the domestic market.

However, due to reasons given in subsequent paragraphs, normal value for

Sudamericana de Fibras S.A has not been determined on the basis of the

questionnaire response submitted by them but has been constructed on the basis of

facts available.

Determination of Normal Value for Non-cooperating producers and exporters

from European Union, Belarus and Peru

42. For the other producers/exporters of European Union, Belarus and Peru,

normal value has been considered based on the facts available. Based on this the

dumping margin is indicated in the dumping margin table.

b) Export Price

Determination of Export Price for producers/exporters from China PR

43. The Authority notes that the following producers/exporters from China PR

have filed exporter questionnaire response:

a. Jilin Qifeng Chemical Fiber Co. Ltd. (Producer/Exporter) – China PR

b. Sinopec Shanghai Petrochemical Co. Ltd. (Producer) – China PR

c. Jinshan Associated Trading Corporation (Exporter) – China PR

44. In view of questionnaire response from the producers/exporters in China PR,

export price in case of responding producers and exporters has been determined on

the basis of their questionnaire response.

M/s Jilin Qifeng Chemical Fiber Co.Ltd.,(“Jilin”) (Producer/Exporter),China

PR

45. The Authority notes that Jilin has exported *** MT of the subject goods to

India. All exports to India were made directly to unrelated Indian customers. Jilin

had claimed adjustments on account of ocean freight, insurance, inland freight and

port handling charges. The Authority has made further adjustments for bank

charges and credit cost to determine net export price at ex-factory level. The ex-

factory export price for Jilin is determined as *** USD/MT.

Page 21 of 49

M/s Sinopec Shanghai Petrochemical Co.,Ltd., (“Sinopec”) (Producer) and

M/s Jinshan Associated Trading Corporation (Jinshan) (Exporter) China PR

46. The Authority notes that Sinopec has exported *** MT of the subject goods to

India directly and through related trader Jinshan. The related trader has exported

316 MT through another trader Xinhe Trading HK Limited based in HongKong.

Xinhe Trading HK Limited has not cooperated with the Authority. Accordingly,

Authority determines not to accept the response filed by Sinopec and Jinshan. The

Authority has accordingly determined export price on the basis of facts available in

terms of Rule 6(8) and the same is indicated in the dumping margin table given

below.

Determination of Export Price for producers/exporters from Belarus

Open Joint-Stock Company Naftan (Belarus)

47. The Authority notes that Naftan has exported *** MT of the subject goods to

India to unrelated customers in India. Naftan has not claimed any adjustment from

the export price. All export sales to India were on FCA basis. Therefore, the

Authority has made appropriate adjustments on account of inland freight, port

handling charges, bank charges and credit cost to determine net export price at ex-

factory level. The ex-factory export price is determined as *** USD/MT.

Determination of Export Price for producers/exporters from European Union

Dralon GmbH (Producer/ Exporter)

48. The Authority notes that Dralon GmbH has exported *** MT of the subject

goods to unrelated customers in India. Dralon has claimed adjustments on account

of ocean freight, insurance, inland freight, port handling charges, commission and

credit cost to determine net export price at ex-factory level, and the Authority has

allowed the same after due verification. The ex-factory export price is determined

as *** USD/MT.

Determination of Export Price for producers/exporters from Ukraine

49. The Authority notes that none of the producers/exporters from Ukraine have

filed exporter questionnaire response. In view of non-cooperation from all the

producer-exporters in Ukraine, the Authority has determined export price on the

basis of best available information in terms of Rule 6(8) and the same is indicated

in the dumping margin table given below.

Page 22 of 49

Determination of Export Price for producers/exporters from Peru

Sudamericana de Fibras S.A, Peru (Producer)

50. The Authority notes that Sudamericana de Fibras has sold *** MT of the

subject goods to India. It is submitted by the producer that all exports to India were

made directly to Indian customers. From the response filed by the producer,

Authority notes that almost *** % of exports to India were made through Dubai

based traders namely M/s. Trans Galactic Trading FZ and M/s. Lanas Fibras

Limited. Further, from the sample documents provided by the company, it is noted

that the export price reported by the producer is not matching with the values in

export invoices. Therefore, the Authority decides to not accept the response of

Sudamericana de Fibras. Accordingly, the export price for Sudamericana de Fibras

has been determined on the basis of facts available.

Determination of Export Price for Non-cooperating producers and exporters

from China PR, European Union, Belarus and Peru

51. For the other producers/exporters of China PR, European Union, Belarus and

Peru, the export value has been considered based on the facts available. Based on

this the dumping margin is indicated in the dumping margin table.

F.4. Calculation of Dumping Margin

52. Comparing the aforesaid normal values and export prices as determined, the

dumping margin proposed to be determined for the subject countries during POI are

as follows:

Dumping Margin Table

Country Producer Exporter Normal

Value

Ex-

factory

Export

Price

Dumping

Margin

Dumping

Margin

Dumping

Margin

US$/MT US$/MT US$/MT % Range

China

PR

M/s Jilin

Qifeng

Chemical

Fiber Co.Ltd

M/s Jilin

Qifeng

Chemical

Fiber Co.Ltd

*** *** *** ***

0-10

China

PR

All Others All Others *** *** *** *** 0-10

Belarus Open Joint-

Stock

Company

Naftan

Open Joint-

Stock

Company

Naftan

*** *** *** ***

30-40

Page 23 of 49

Country Producer Exporter Normal

Value

Ex-

factory

Export

Price

Dumping

Margin

Dumping

Margin

Dumping

Margin

Belarus All Others All Others *** *** *** *** 65-75

European

Union

Dralon

GmbH

Dralon GmbH *** *** *** *** 10-20

European

Union

All Others All Others *** *** *** *** 30-40

Ukraine All All *** *** *** *** 0-10

Peru All All *** *** *** *** 20-30

53. It is seen that the dumping margins are more than the de-minimis limits

prescribed under the Rules in respect of exports made from each of the cooperating

producers/exporters and non-cooperative producers/ exporters from subject

countries.

G. DETERMINATION OF INJURY AND CAUSAL LINK

54. The Petitioners have alleged that the dumped imports from the subject

countries are causing material injury to the domestic like product in India. Having

determined that the goods are entering from the subject countries at dumped prices,

the Authority proceeds to examine the degree and extent of injury, if any, suffered

by the domestic industry.

55. Rule 11 of the Rules read with Annexure – II provides that an injury

determination shall involve examination of factors that may indicate injury to the

domestic industry, “…. taking into account all relevant facts, including the volume

of dumped imports, their effect on prices in the domestic market for like articles

and the consequent effect of such imports on domestic producers of such

articles….”. In considering the effect of the dumped imports on prices, it is

considered necessary to examine whether there has been price undercutting by the

dumped imports as compared with the price of the like article in India, or whether

the effect of such imports is otherwise to depress prices to a significant degree or

prevent price increases, which otherwise would have occurred, to a significant

degree.

G.1. Submissions made by the Domestic Industry

56. Submissions made by the domestic industry in this regard are as follows:

Page 24 of 49

i. Landed price of subject goods has remained below the cost of sales as well

as the selling price. Imports are suppressing/depressing the domestic prices.

ii. Imports are resulting in significant price underselling as evidenced by the

difference between the non-injurious price and landed price of imports.

iii. Performance of the domestic industry has deteriorated in terms of

production, capacity utilization, sales, inventories, profits, return on

investments, cash flow, and market share.

iv. The deterioration in performance of the domestic industry is more

prominent in the POI on quarterly basis.

v. Domestic industry has been prevented from utilizing its capacities to the

fullest extent on account of continued dumped imports in the market from

existing and fresh sources.

vi. Market share of the domestic industry declined drastically over the injury

period whereas that of subject countries has increased. Market share of

Indian industry as a whole has also declined despite having sufficient

capacity to cater to the demand.

vii. Domestic industry is not in a position to make any fresh investments.

viii. Anti-dumping duty is urgently required to be imposed on subject countries

in order to prevent further deterioration of performance of the domestic

industry.

ix. The capacity utilization of any industry is seen for the production as a

whole, since at the stage of production, the domestic and export production

cannot be segregated.

x. Employment and wages are not truly reflective factors of the injury being

suffered by the domestic industry.

xi. With regard to return on capital employed, domestic industry has claimed

volume injury in the present case.

xii. The dumping margin is positive and therefore the fact that the import prices

declined due to raw material price decline is irrelevant. The domestic

industry suffered adverse volume effect due to price undercutting and

resultant increase in imports. As a direct consequence, the production,

capacity utilization, market share, sales volumes declined and inventories

increased.

Page 25 of 49

xiii. The ROI of the domestic industry over the injury period have been quite

low. Further, the average ROI of the domestic industry since its inception

have been quite low. The domestic industry has never paid dividend to the

shareholders and is facing quite low credit ratings.

xiv. Price undercutting should be determined only considering injurious import

transactions. Petitioner's concern is not against non-injurious imports.

Reference is made to the Hon'ble CESTAT’s decision in Kothari Sugars &

Chemicals Ltd. vs. DA. Reference is also made to WTO panel report in EC

– Tube or Pipe Fittings.

G.2. Submissions made by the foreign producers/exporters/other interested

parties

57. Submissions made by the foreign producers/exporters/other interested parties

in this regard are as follows:

i. The domestic industry’s claims of injury need extra scrutiny by the Authority as

the facts show a robust situation.

ii. Demand has not fallen per se. The exporters are capable of supplying specialty

product given the divergent needs of the Indian users and the domestic

industry’s inability to cater to the demand for specialty grades should not be

seen as an adverse implication for market share.

iii. Profitability of domestic industry with regard to domestic sales has not declined

rather has substantially increased. In fact, in 2015-16 and 2016-17, the domestic

industry has made super profits. Similarly, cash profits, profit before interest

and tax, and return on capital have substantially increased in the injury period.

iv. Production and capacity utilization have significantly increased in the injury

period. In fact, capacity utilization has settled at a high of 89% in the POI.

v. Domestic sales have declined because domestic industry is diverting its

production for export sales as can be seen from an increase in export sales

value.

vi. Decline in domestic industry’s domestic sales volume can be explained by

decline in total demand for the subject goods in India.

vii. Annual Report of Pasupati Acrylon Ltd. itself states that it has taken a

conscious decision to increase thrust on exports.

Page 26 of 49

viii. Petitioners’ market share in India has declined due to increased focus on exports

and decline in demand in domestic market.

ix. Market share of Other Domestic Producer – Vardhman Acrylics Ltd, has

remained more or less the same in spite of absolute increase in import volume

from the subject countries. This shows that the Domestic Industry has not been

as efficient and competitive as the other domestic producer.

x. Market share of imports from the EU has decline in the POI in comparison to

the base year.

xi. The increase in Domestic Industry’s inventory is due to increase in export sales.

Increase in inventory must be assessed as a percentage of total sales volume.

xii. Increase in import volume as a proportion of both production and consumption

has been not more than 10% throughout the injury period, which cannot be

considered significant at all.

xiii. Share of subject imports as a proportion of overall imports is not a factor for

determination of volume effect and hence of injury.

xiv. Volume of imports from the EU has declined in the POI.

xv. Petitioners’ calculation of landed value is erroneous as customs duty and cess

have been added to the CIF value instead of the assessable value, thereby

resulting in a lower landed value.

xvi. Though the landed value is the same in both the Original Petition and the

revised Annexures for the years 2013-14, 2014-15, and 2015-16, the price

undercutting range in the revised Annexures has been shown as 0-30%. Such a

dramatic increase needs explanation. Further, the range of undercutting of 0-

30% is too wide in comparison to an acceptable range of 5-10 points.

xvii. Domestic industry has not reduced its domestic selling prices to the extent of

the decline in raw material costs, which the exporters have done, thereby

resulting in landed prices being lower than the domestic selling prices.

xviii. Impact of imports from Taiwan is not segregated and it cannot be said that any

alleged impact on various injury parameters is on account of imports from

subject countries.

xix. Landed value of imports from the European Union is the highest.

Page 27 of 49

xx. The Petitioner – Indian Acrylics Ltd. has cited demonetization as having

affected growth in its Annual Report 2016-17.

xxi. Decline in domestic sales volume in 2016 is due to warm winter and increase in

preference of lower-priced leather jackets.

xxii. The economic parameters such as salary and wages, employees, return on

capital employed, and profit/(loss) demonstrate that the Petitioners have in fact

seen a positive growth during the POI and hence cannot state that it is suffering

injury.

xxiii. The Appellate body in the European Communities – Anti-Dumping Duties On

Imports Of Cotton-Type Bed Linen From India WT/DS141/AB/R dated March

1, 2001 held that the zeroing methodology is inconsistent with Article 2.4 and

Article 2.4.2 of the AD Agreement

xxiv. Hon’ble Tribunal’s order in the case of Kothari Sugars & Chemicals Limited

versus Designated Authority (2005 (187) ELT 185 Tri Del) that has been relied

upon by the Petitioners cannot be considered in the present factual matrix. The

Hon’ble Tribunal’s order was based on the fact that the data from EU was

incomplete and the imports were preventing a price increase

xxv. It is reiterated that the performance of the petitioner especially profitability

clearly establishes neither direct nor indirect link between the two i.e., domestic

industry’s performance and importation of subject goods. It is also pertinent to

mention here that the profitability of the petitioners were at their lowest when

the imports from the subject countries were at its lowest (i.e., during the base

year) but the same increased significantly over the injury period including POI

despite alleged increase in alleged dumped imports from subject countries. This

clearly proves that the import from the subject countries has not impacted on

the profitability of the petitioners’ or its commercial performance.

xxvi. The decline in volume parameters, when the DI could admittedly maintain its

prices at robust margin levels cannot be presumed to have been caused by

alleged dumped imports.

xxvii. It can be seen that all the parameters that existed in Playing Cards case are

almost similar as the parameters existing in Acrylic Fibre case. Thus, in view

of the above, the Anti-Dumping Duty should not to be continued and present

investigation should be terminated on the same grounds.

Page 28 of 49

xxviii. The decline in volume parameters when the domestic industry could admittedly

maintain its prices at robust margin levels cannot be presumed to have been

caused by alleged dumped imports.

xxix. An objective examination of injury necessitates examination of overall position

of the domestic industry including the price parameters which would show that

there is no injury as envisaged in the AD Rules. If a holistic view of the case is

taken then there is no case of injury demonstrated by the domestic industry.

G.3. Examination by the Authority

a) Cumulative Assessment

58. Annexure II (iii) of the AD Rules provides that in case imports of a product

from more than one country are being simultaneously subjected to anti-dumping

investigation, the Authority will cumulatively assess the effect of such imports, in

case it determines that: -

a) the margin of dumping established in relation to the imports from each

country/ territory is more than two percent expressed as percentage of

export price and the volume of the imports from each country is three

percent of the imports of the like article or where the export of the

individual countries is less than three percent, the imports cumulatively

accounts for more than seven percent of the imports of like article, and;

b) Cumulative assessment of the effect of imports is appropriate in light of the

conditions of competition between the imported article and the like

domestic articles.

59. In the present case, the margin of dumping from each of the subject countries

have been found to be more than the de minimis limit prescribed; the volume of

dumped imports from each of the subject countries is more than the limits

prescribed; and the exports from the subject countries directly compete inter se and

with the like goods offered by the domestic industry in the Indian market.

Cumulative assessment of the effects of the dumped imports is appropriate in the

light of the conditions of competition between the imported products and the

conditions of competition between the imported products and the like domestic

product. The Authority, therefore, considers it appropriate to cumulatively assess

the effect of dumped imports from the subject countries.

b) Examination of Injury Parameters

60. The Authority has taken note of the submissions made by the interested

parties. The Authority has examined the submissions made by the domestic

Page 29 of 49

industry and other interested parties with regard to the injury in accordance with the

Antidumping Rules.

i. Assessment of Demand and Market Share

61. The Authority has defined, for the purpose of the present investigation,

demand or apparent consumption of the product in India as the sum of domestic

sales of the Indian Producers and imports from all sources. The demand so assessed

is given in the table below.

Demand Unit 2013-14 2014-15 2015-16 POI

Sales of Domestic Industry MT 52,739 41,655 48,200 37,749

Sales of Other Producers MT 20,616 20,620 20,585 18,333

Imports - Subject Countries MT 12,596 14,215 16,270 17,951

Import - Other Countries MT 19,523 17,257 18,493 13,445

Total Demand MT 1,05,203 93,746 1,03,548 87,479

Market Share %

Domestic industry % 50 44 47 43

Other Producers % 20 22 20 21

Subject countries % 12 15 16 21

Other Countries % 18 18 18 15

Total % 100 100 100 100

62. The Authority notes that the demand for the product under consideration has

decreased in the POI. Demand has declined from 2013-14 to 2014-15, before

increasing in 2015-16. However, there is decline in demand in the POI as compared

to 2015-16 and also earlier years. The market share of the domestic industry has

declined from 50% in 2013-14 to 44% in 2014-15. It then increased slightly to 47%

in 2015-16 before again declining to 43% in the POI.

63. The market share of the other domestic producer has more or less remained

stable during the injury period.

64. Market share of the subject countries on the other hand has increased from

12% in the base year to 15% in 2014-15 to 16% in 2015-16 and then to 21% in the

POI.

Volume and Price Effect of the dumped imports on the Domestic industry

ii. Volume Effect: Import Volume and share of subject countries

Page 30 of 49

65. With regard to volume of the dumped imports, the Authority has examined

whether there has been a significant increase in dumped imports either in absolute

terms or relative to production or consumption in India. The volume of imports of

the subject goods from the subject countries have been analyzed as under:

Particulars Unit 2013-14 2014-15 2015-16 POI

Import Volumes

China MT 23 1,529 2,737 2,989

Belarus MT 2,185 2,613 1,322 1,023

European Union MT 10,388 10,073 12,034 9,357

Ukraine MT - - - 2,195

Peru MT - - 177 2,387

Subject Countries MT 12,596 14,215 16,270 17,951

Countries attracting ADD MT 11,274 12,683 13,670 10,656

Other Countries MT 7,979 4,573 4,823 2,790

Total MT 31,848 31,471 34,763

31,397

Market Share in Imports

China PR % 0.07 4.86 7.87 9.52

Belarus % 6.86 8.30 3.80 3.26

European Union % 32.62 32.01 34.62 29.80

Ukraine %

6.99

Peru %

0.51 7.60

Subject Countries % 39.55 45.17 46.80 57.18

Countries attracting ADD 35.40 40.30 39.32 33.94

Other Countries % 25.05 14.53 13.87 8.88

Total % 100.00 100.00 100.00

100.00

Demand MT 1,05,203 93,746 1,03,548 87,479

Indian Production MT 88,211 85,220 1,01,386 90,869

Subject Imports in relation to

Demand % 12 15 16 21

Indian Production % 14 17 16 20

66. The Authority notes that the volume of dumped imports of the product under

consideration have increased in absolute terms as well as in relation to consumption

and production in the country, throughout the injury period, except during 2015-16

when it marginally declined in relation to the production as compared to previous

year.

Page 31 of 49

67. Share of imports from the subject countries as a whole in relation to the total

imports into India has increased to 57.18% in the POI from 39.55% in the base

year.

iii. Price Effect of dumped imports and impact on the domestic industry

68. With regard to the effect of the dumped imports on prices, it is required to be

analyzed whether there has been a significant price undercutting by the alleged

dumped imports as compared to the price of the like products in India, or whether

the effect of such imports is otherwise to depress prices or prevent price increases,

which otherwise would have occurred in normal course.

69. Accordingly, the impact on the prices of the domestic industry on account of

dumped imports of the subject goods from the subject countries has been examined

with reference to price undercutting, price suppression/depression and price

underselling, if any. For the purpose of this analysis the cost of production, Net

Sales Realization (NSR) and the Non-injurious Price (NIP) of the Domestic

industry have been compared with the landed price of imports from subject

countries.

Price Undercutting

70. Price undercutting has been determined by comparing the landed price of

imports from the subject countries with the net sales realisation of the domestic

industry in India.

Particulars Unit 2013-14 2014-15 2015-16 POI

Net Sales Realization Rs/MT *** *** *** ***

Subject Countries as a

whole

Landed Price Rs/MT 1,64,370 1,71,432 1,33,021 1,15,383

Price undercutting Rs/MT *** *** *** ***

Price undercutting % % *** *** *** ***

Price undercutting Range Negative Negative 0-10 10-15

BELARUS

Landed Price Rs/MT 1,81,152 1,81,901 1,34,812 1,08,167

Price undercutting Rs/MT *** *** *** ***

Price undercutting % % *** *** *** ***

Price undercutting Range Negative Negative 0-5 15-20

CHINA PR

Page 32 of 49

Particulars Unit 2013-14 2014-15 2015-16 POI

Landed Price Rs/MT 2,36,374 1,67,059 1,30,136 1,18,984

Price undercutting Rs/MT *** *** *** ***

Price undercutting % % *** *** *** ***

Price undercutting Range Negative 0-5 0-5 0-10

EUROPEAN UNION

Landed Price Rs/MT 1,60,682 1,69,380 1,33,618 1,18,619

Price undercutting Rs/MT *** *** *** ***

Price undercutting % % *** *** *** ***

Price undercutting Range 0-5 Negative 0-5 0-10

UKRAINE

Landed Price Rs/MT - - - 1,17,680

Price undercutting Rs/MT - - - ***

Price undercutting % % - - - ***

Price undercutting Range - - - 5-15

PERU

Landed Price Rs/MT - - 1,23,702 99,173

Price undercutting Rs/MT - - *** ***

Price undercutting % % - - *** ***

Price undercutting Range - - 0-10 20-30

71. It is seen from the table above that the landed price of imports from the subject

countries are undercutting the domestic selling prices in the POI.

Price Suppression / Depression

72. In order to determine whether the dumped imports are suppressing or

depressing the domestic prices, the Authority notes the changes in the costs and

prices over the injury period. The position is shown as per the table below:

Particulars Unit 2013-14 2014-15 2015-16 POI

Cost of Sales Rs/MT *** *** *** ***

Indexed 100 104 76 73

Selling Price Rs/MT *** *** *** ***

Indexed 100 103 84 81

Landed Price from subject

countries Rs/MT *** *** *** ***

Indexed 100 104 81 70

Page 33 of 49

73. The cost of sales has declined by 27% in the POI as compared to base year

whereas the Petitioners have decreased the selling price only by 19% in the POI.

So, imports have had no suppressing effect on the domestic selling price. The

landed price of imports from subject countries has been above the cost of sales of

the domestic industry throughout the injury investigation period and also during the

POI.

Price underselling

74. The Authority has also examined price underselling suffered by the domestic

industry on account of dumped imports from subject countries. It is noted that there

has been price underselling only from Belarus and Peru during the POI on account

of dumped imports. There has been no price underselling from China PR, EU and

Ukraine during the POI as can be seen in the table below:

Particulars Unit

China

PR Belarus EU Ukraine Peru

Non-Injurious

Price Rs/MT *** *** *** *** ***

Landed price of

imports in POI Rs/MT 1,18,984 1,08,167 1,18,619 1,17,680 99,173

Price

Underselling Rs/MT *** *** *** *** ***

Price

Underselling % *** *** *** *** ***

Price

Underselling Range% Negative 0-10 Negative Negative 0-20

G.4. Examination of economic parameters relating to the domestic industry:

75. Annexure II to the AD Rules requires that a determination of injury shall

involve an objective examination of the consequent impact of these imports on

domestic producers of like products. With regard to consequent impact of these

imports on domestic producers of like products, the Rules further provide that the

examination of the impact of the dumped imports on the domestic industry should

include an objective and unbiased evaluation of all relevant economic factors and

indices having a bearing on the state of the industry, including actual and potential

decline in sales, profits, output, market share, productivity, return on investments or

utilization of capacity; factors affecting domestic prices, the magnitude of the

margin of dumping; actual and potential negative effects on cash flow, inventories,

employment, wages, growth and ability to raise capital investments.

Page 34 of 49

76. Accordingly, various economic parameters of the domestic industry are

analyzed herein below:

a) Capacity, Production and Capacity Utilization & Sales

77. The Authority has considered capacity, production, capacity utilization and

sales volume of the domestic industry over the injury period and notes as follows:

Particulars Unit 2013-14 2014-15 2015-16 POI

Capacity MT 81,600 81,600 81,600 81,600

Production MT 67,783 64,425 80,706 72,536

Capacity Utilisation % 83 79 99 89

Domestic Sales MT 52,739 41,655 48,200 37,749

Demand MT 1,05,203 93,746 1,03,548 87,479

78. It is noted from the table above that:

i. The domestic industry has maintained the same level of capacity over the entire

injury period and POI.

ii. While production declined in 2014-15, it increased significantly in 2015-16,

before declining again in the POI. Capacity utilization increased to 99% in

2015-16 before settling at 89% in the POI.

iii. The volume of domestic sales decreased in 2014-15 before increasing in 2015-

16 and again decreasing in the POI.

b) Market Share of Domestic industry in demand

79. The effects of the dumped imports on the market share of the domestic

industry have been examined as below. It is noted that barring slight increase

during 2015-16, the market share of the domestic industry has decreased

throughout. The market share of the other domestic producer, Vardhman Acrylics

Ltd., however has remained at more or less the same level.

Market Share Unit 2013-14 2014-15 2015-16 POI

Domestic Industry % 50 44 47 43

Other Producer % 20 22 20 21

Subject Countries % 12 15 16 21

Other Countries (including

countries attracting ADD) % 18 18 18 15

Total % 100 100 100 100

Page 35 of 49

c) Stock/inventories

80. The Authority further notes that the average inventory levels of the domestic

industry has shown increasing trend. However, the inventory levels cannot be

considered in isolation and hence the Authority deems it necessary to examine the

same with the volume of total sales.

81. Inventory as a proportion of total sales has increased only by a small

percentage during the POI. The average inventory level is equivalent to

approximately half a month’s production only.

d) Profits, Cash Profits and Return on Capital Employed

82. Performance of the domestic industry was examined in respect of profits, cash

profits and return on capital employed.

Particulars Unit 2013-14 2014-15 2015-16 POI

Cost of

Domestic Sales Rs/MT *** *** *** ***

Indexed 100 104 76 73

Selling Price Rs/MT *** *** *** ***

Indexed 100 103 84 81

Profit / Loss Rs/MT *** *** *** ***

Trend

100 87 322 320

Profit / Loss Rs. Lacs *** *** *** ***

Trend

100 69 294 229

Cash Profit Rs. Lacs *** *** *** ***

Trend

100 68 217 170

Profit before

Interest & Tax Rs. Lacs *** *** *** ***

Trend

100 73 212 165

Return on

Capital

Employed %

*** *** *** ***

Particulars Unit 2013-14 2014-15 2015-16 POI

Average Inventory MT *** *** *** ***

Trend 100 117 143 172

Total Sales MT 68,762 62,834 81,314 70,589

Inventory as a

proportion of total

sales

% *** *** *** ***

Trend % 3%-5% 3%-5% 3%-5% 3%-5%

Page 36 of 49

Particulars Unit 2013-14 2014-15 2015-16 POI

Trend

100 79 239 176

83. It is noted from the table above that:

i. Profits/ MT has increased substantially in the POI and the preceding year

(2015-16).

ii. Cash profits have improved considerably during 2015-16 before registering a

slight decline in the POI. However, even after the slight decline, cash profits in

the POI are much above the cash profit in the base year.

iii. Return on capital employed has improved significantly in the injury period.

iv. Return on capital employed has been well above the standard 22% allowed by

the Authority while determining the NIP throughout the injury investigation

period including POI.

v. Return on capital employed during the POI was as high as in the range of 50%-

60%.

e) Employment and Wages

84. It is seen from the table below that the number of employees has witnessed

marginal increase in 2015-16 and POI. Salaries and wages paid by the domestic

industry have however increased in greater proportion.

Particulars Unit 2013-14 2014-15 2015-16 POI-A

Employment Nos *** *** *** ***

Trend

100 100 103 106

Salary and

Wages Rs. Lacs *** *** *** ***

Trend

100 108 116 146

f) Growth

85. Examination of growth parameters of the domestic industry during the injury

period is shown below.

Growth Unit 2013-14 2014-15 2015-16 POI

Production % - -4.95 25.27 -10.12

Sales % - -21.02 15.71 -21.68

Capacity Utilization % - -4.82 25.32 -10.10

Profit/Loss per unit % - -12.67 268.19 -0.46

Return on Capital

Employed %

- -21 160 -63

Market Share - DI % -

Page 37 of 49

g) Level of Dumping and Dumping Margin

86. The dumping margin in respect of each of the subject countries is not only

more than de-minimis but also significant.

h) Factors affecting domestic prices

87. The selling prices of the domestic industry has not been affected by dumped

imports from the subject countries because there is no price suppression. The

domestic industry is earning healthy profits and return on capital employed. The

selling price of the domestic industry during POI was significantly more than the

NIP determined by the Authority.

i) Ability to raise fresh Investment

88. The Authority notes that the domestic industry is earning healthy profits and

healthy return on capital employed, therefore it has the ability to raise fresh

investments.

G.5. Magnitude of Injury And Injury Margin

89. The non-injurious price of the subject goods produced by the domestic

industry when compared with the landed value of the exports from the subject

country shows the position as under :

Country Producer Exporter NIP

US$ per

MT

Landed

Value

US$ per

MT

Injury

Margin

US$ per

MT

Injury

Margin

INR per

MT

Injury

Margin

%

US$/MT US$/MT US$/MT % Range

China

PR

M/s Jilin

Qifeng

Chemical

Fiber Co.Ltd

M/s Jilin

Qifeng

Chemical

Fiber Co.Ltd

*** *** *** *** (10)-0

China

PR

All Others All Others *** *** *** *** (10)-0

Belarus Open Joint-

Stock

Company

Naftan

Open Joint-

Stock

Company

Naftan

*** *** *** *** 0-10

Belarus All Others All Others *** *** *** *** 15-25

European

Union

Dralon GmbH Dralon

GmbH *** *** *** *** (15)-0

Page 38 of 49

Country Producer Exporter NIP

US$ per

MT

Landed

Value

US$ per

MT

Injury

Margin

US$ per

MT

Injury

Margin

INR per

MT

Injury

Margin

%

European

Union

All Others All Others *** *** *** ***

(5)-0

Ukraine All All *** *** *** *** (10)-0

Peru All All *** *** *** *** 5-15

H. POST DISCLOSURE STATEMENT SUBMISSIONS BY THE

INTERESTED PARTIES

90. The post disclosure submissions have been received from the interested

parties. Majority of the issues raised therein have already been raised earlier

during the investigation and also addressed appropriately. Additional

submissions have been analysed as under:

H.1. Submissions by the domestic industry

91. The Domestic Industry has made the following submissions:

i. Homo polymer is also acrylic fibre and is not a separate product and should

not be excluded from the PUC. There has been no exclusion in the scope of

the PUC by the Authority in several investigations conducted in the past.

ii. The POI in the present investigation is within the year 2016, which is well

before the expiry of China’s Accession Protocol. In any case, the provisions

of Article 15(a)(i) of the Accession Protocol are still applicable and must be

considered for determination of normal value for China.

iii. The Authority has constructed the normal value based on best available

information and have considered cost of production of the domestic

industry for the same. However, the earlier submitted evidence of price of

Acrylic Fibre prevailing in Asia (Far East) Region as per IHS Chemical

report has not been considered. There is no reasoning in the disclosure

statement as to why such information cannot be accepted and the hierarchy

laid down under the law should not be followed.

iv. The import volume has increased despite a decline in demand. This fact is

sufficient to hold that the domestic industry has suffered injury.

Page 39 of 49

v. The volume of subject imports constitutes significant share of imports into

India and such share, as a whole, to the total imports into India has

increased to 57.18% in the POI from 39.55% in the base year.

vi. The prior submission that price undercutting should be determined

considering only those transactions whose landed price of imports is below

the selling price of the domestic industry, though noted by the Authority,

has not been examined.

vii. The cost of sales increased till 2014-15 but declined thereafter. The selling

price of the domestic industry also followed the same trend but the landed

price of the subject goods remained below the cost of sales as well as the

selling price.

viii. In determination of price effect, the AD rules have an “OR” as a

requirement and not “AND” between suppression/depression and price

undercutting.

ix. The domestic industry’s production has improved till 2015-16 and declined

thereafter in the POI. Sales have declined significantly over the injury

period and the decline is much more than the decline in demand. Capacity

utilization has declined as compared to the year preceding the POI.

x. The Authority is requested to correlate various parameters relating to the

domestic industry, while concluding adverse volume effect in the present

case. Imports have not followed the trend of demand. Even when demand

declined, imports increased.

xi. Inventories have increased both in absolute terms and in proportion to

domestic sales. The legal requirement is whether performance of the

domestic industry deteriorated in respect of inventories. There was no

reason for the domestic industry to increase its inventories when its

production and sales were falling.

xii. The domestic industry has been forced to suspend production and suffered

heavily due to decline of production and sales. It would also be seen that

there is a direct correlation between decline in production and increase in

inventories

xiii. The domestic industry’s market share has declined drastically over the

injury period whereas that of the subject countries has increased. Market

share of Indian industry as a whole has also declined despite having

sufficient capacity to cater to the demand.

Page 40 of 49

xiv. The domestic industry’s profitability, cash profit and return on investment

has improved. Thus, the effect of dumping is not visible on these

parameters. The domestic industry withheld price declines partially at the

time of reduction in raw material prices in view of its long adverse

performance with regard to profits.

xv. The continued/renewed dumping/long history of dumping from various

sources has not given the Petitioners a single chance to recover from the ill

effects of such continuous dumping and pay dividends to its shareholders

even once.

xvi. The wages paid and number of employees has increased in the injury

period. These are not solely dependent on the performance of the subject

goods, and are governed by overall operations of the company and the

economy. They may not reflect the adverse impact of dumping.

xvii. The domestic industry is not in a position to make any fresh investments as

it is facing dumping of imports from various countries.

xviii. The average import price from subject countries is much lower than the

non-injurious price of the domestic industry showing significant injury

margin.

xix. The imports of the PUC from other countries are negligible, both in volume

and value, and imports from Thailand are already attracting duty. Almost

57% of imports are from subject countries.

xx. There is a decline in demand of the subject product. However, imports from

subject countries have increased in the injury period including POI, thus,

causing material injury to the domestic industry in a situation of declining

demand.

xxi. In past investigation such as viscose staple fibre, front axle beam; wherein

the demand for the PUC had declined; the Authority held that the increase

in imports in a situation of decline in demand established that dumping has

caused injury to the domestic industry.

xxii. Detailed breakup of NIP has to be disclosed by the Authority.

xxiii. The NIP considered by the Authority has been quite low thereby resulting

in an unduly low injury margin.

Page 41 of 49

xxiv. The Authority may disclose the non-confidential version of the verification

report of the exporters/producers from the subject countries to offer

meaningful comments on the dumping margin calculated.

xxv. The disclosure statement gives an impression that the following have been

considered as facts, whereas these are parameters: trends in import volume;

price effect; cumulative assessment of injury. Essential facts under

consideration with regard to injury to the domestic industry have not been

disclosed in the disclosure statement.

xxvi. The form of anti-dumping duty should be fixed quantum of anti-dumping

duty.

xxvii. The anti-dumping duty should be imposed in terms of US$ in the final

determination. Rupee has depreciated significantly and therefore, the

definitive duties may kindly be expressed in US$.

H.2. Submissions by other interested parties

92. The following submissions have been made by

producers/exporters/importers/other interested parties:

i. The downstream industry is forced to import several types of speciality

acrylic fibres on account of non-availability/non-manufacturing of the same

by any domestic producer. The need and requirement of specific types of

Acrylic Fibre for the production of downstream goods of specific

quality/characteristic is not governed by the import price but on account of

specific speciality acrylic fibre.

ii. These speciality fibres are required for qualities like anti-piling, soft and

lustrous look etc. which is not possible to achieve by using acrylic fibre

produced by Indian producers. Hence, the import of these speciality fibres

should be kept out of the scope of PUC for the purpose of instant

investigation.

iii. There are differences between the first quality grades and the lower quality

grades. These cannot be considered as “like articles” because they are

different with respect to technical and commercial substitutability, product

specifications, functions and end-uses, end-user requirement and pricing.

The Authority may exclude Second Grade from the scope of the PUC.

Page 42 of 49

iv. The normal value of OJSC Naftan should be determined on the basis of

information provided in the questionnaire because Belarus was recognized

by the Government of India as a country with a market economy.

v. OJSC Naftan disagrees with the dumping margins calculated by the

Authority. According to the information sent by OJSC Naftan in the

questionnaire, the dumping margin is negative. Thus, the investigation

against acrylic fibre produced by OJSC Naftan should be terminated.

vi. The Authority is requested to take into account the submissions made by

Sudamericana de Fibras S.A in order to calculate the export price rather

than merely construct it. Accordingly, Sudamericana may also be granted

an individual margin of dumping and injury.

vii. A negative injury margin has been calculated for China PR, European

Union and Ukraine. This indicates that only 19% of the subject imports are

below non-injurious price. There is no cause for injury to be caused by

those low-priced imports, which are above the NIP.

viii. While the point-to-point analysis of the trend of imports shows that the

imports have increased, the trend of increased imports is not established

during the entire injury period (for FY 2015-2016 there is dip in the imports

into India).

ix. Given the fact that there is no injury margin for imports originating from

China PR, European Union and Ukraine (comprising more than 75% of

total imports from subject countries) the volume and price effect do not

establish a causal link between injury to the domestic industry and the low-

priced imports from subject countries.

x. There is an inherent contradiction in the manner in which the conclusion on

underselling has been arrived. The disclosure statement states that there is

underselling in the prices of PUC, however the table shows that there is no

underselling from more than 75% of the imports in India from subject

countries.

xi. There is a pattern of fixed increase and decrease in capacity utilization of

the domestic industry.

xii. Since major financial parameters such as profits, cash flows and return on

capital employed have substantially improved, the economic indicators do

not provide a substantive evidence as to existence of injury to the domestic

industry.

Page 43 of 49

xiii. The Disclosure Statement does not provide any analysis on the impact of

such duties on the users / importers. If duty is levied on Acrylic Fibre then

the cost of spinning companies for acrylic yarn will increase.

xiv. The impact of duty will have to be absorbed by the ailing spinning industry

since the weavers and knitters (end users of acrylic yarns) do not have

alternative sources available from sources outside India.

xv. The import volume of acrylic fibre produced by Belarusian companies has

decreased and does not cause any injury to the domestic industry, or threat

thereof.

xvi. The imposition of anti-dumping duty on imports of the PUC will harm the

users and lead to the closure of a large number of small end-users of the

PUC.

xvii. The production, capacity utilization and sales has moved in accordance with

the market trend over the injury period.

xviii. There is contraction in demand for the PUC in the POI as compared to

2015-16. The market share of the domestic industry has followed a similar

trend. The domestic industry’s market share is also required to be seen in

the light of inter-se fibre competition and need for speciality fibre by the

user industry.

xix. While determining volume effect, the Authority must note that the increase

in subject imports is largely on account of necessity for speciality fibre for

production of speciality yarn in order to remain relevant in the increasingly

competitive market due to free availability of imported material on account

of various FTAs with the countries like Thailand, Bangladesh, Sri-Lanka

etc.

xx. A simple comparison of NSR with landed price in India will not give a true

account as regard to price-undercutting as the Petitioners’ domestic selling

prices are significantly higher than the NIP.

xxi. The domestic industry has resorted to premium pricing in domestic market

to subsidise their export sales and such examination of price under-cutting

with significantly higher price of the domestic industry would result in a

skewed analysis and distorted picture.

xxii. There is neither price suppression/depression nor price underselling. The

imports have shown no impact on the pricing of the petitioners’

performance in this respect.

Page 44 of 49

xxiii. The domestic industry’s sales performance is required to be analysed

keeping in view the contraction of demand and inter-se fibre competition.

xxiv. The decline in market share is also required to be seen in light of

contraction of demand, inter-se fibre competition and need for importation

of speciality fibre which is other-wise not produced domestically.

xxv. Only 20% of the total imports in the POI was from Belarus and Peru and

the rest were from EU, Ukraine and China PR. In such a scenario, any

decision to still slap anti-dumping duties on Belarus and Peru based on the

positive IM on paper would be illogical and irrational given the fact that the

domestic industry did not suffer any material injury.

xxvi. The domestic producers in India lag in production technology and are

incapable of producing speciality fibres. As a result, the user industry is

forced to import the same for the purpose of staying relevant in the market

in the background of stiff competition due to various FTAs

xxvii. There is a direct conflict of interest between the Indian producers of Acrylic

Fibre and user industry in India. The domestic industry shares a dual

relationship with the user industry i.e., that of client and competitor. The

domestic industry is charging higher prices for subject goods from the user

industry not only to earn higher profits but also to gain an economic edge

over user industry in the downstream market as well, which certainly

qualifies as both restrictive as well as anti-competitive practices.

xxviii. Cognizance should have been taken with regard to imports from Taiwan

which were much higher than the imports from Belarus. The share of

imports from Taiwan stood at about 5% in total imports and the price from

Taiwan was lower than the price of the subject goods from subject

countries.

xxix. Without prejudice, should the domestic industry still claim injury on

account of imports from subject countries, they need to first establish why

imports from Taiwan were not causing any injury though they were above

de-minimis levels and also at lower prices comparable to subject countries.

xxx. With regard to the inclusion of Taiwan in the scope of investigations, the

Authority notes that no arguments have been advanced or evidence

produced to show that imports of the product under consideration from

Taiwan are being dumped into India. Hence, there is no requirement to

include Taiwan within the scope of this investigation.

Page 45 of 49

xxxi. Sudamericana de Fibras S.A has complied with the confidentiality

requirements as per AD Rules and trade notices. Therefore, the Petitioner’s

excessive confidentiality claims made with respect to Sudamericana should

be disregarded.

H.3. Examination by the Authority

93. The examination by the Authority for the issues raised above and considered

relevant is as under:

i. The product under consideration is Acrylic Fibre. It is a long chain of

synthetic polymer composed of at least 90% by weight of Acrylonitrile

units (major raw material for production). The term Acrylic Fibre includes

acrylic staple fibre, acrylic tow and acrylic top, all of which are known as

Acrylic Fibre in commercial parlance. The only difference between Acrylic

staple fibre and Acrylic tow is the difference in length. In case of length

more than 2 meters, it is known as tow and in case of cut lengths, it is

known as staple fibre.

ii. Acrylic Fibre is lightweight, soft, and warm, with a wool-like feel. Its fibres

are very resilient and shows high resistance to acids and alkalies compared

to both natural and other synthetics fibres. Acrylic Fibre is an economical

substitute of wool.

iii. Acrylic Fibre is classified under chapter 55 of the Customs Tariff Act under

the sub-heading 5501, 5503 and 5506 at 4-digit level. The product is

covered under HS code 550130, 550330 and 550630. However, the customs

classification is indicative only and in no way binding upon the product

scope.

iv. With regard to the issue of lower quality or second grades, the Authority

notes that product cannot be excluded from the scope of the investigation

merely on the quality grounds. Further, interested parties have not provided

any evidence to demonstrate that these lower quality grades are not

competing with the like article manufactured by the domestic industry.

Therefore, Authority determines not to exclude these grades.

v. It is an admitted fact that the domestic industry does not manufacture

Homopolymer Acrylic Fibre containing 100% Acrylonitrile. A letter from

M/s Pasupati Acrylon Ltd. mentioning that they do not produce Homo

Polymer Acrylic Staple Fibre too has been furnished. Therefore, the

Authority determines that the scope of the product under consideration is all

forms of Acrylic Fibre except Homo Polymer Acrylic Fibre containing

100% Acrylonitrile.

Page 46 of 49

vi. After considering the information on record, the Authority intends to hold

that there is no known difference in the subject goods produced by the

domestic industry in India and that exported from the subject countries.

Subject goods produced by the Petitioners and that imported from the

subject countries are comparable, in terms of product characteristics such as

physical & chemical characteristics, manufacturing process & technology,

functions & uses, product specifications, pricing, distribution & marketing

and tariff classification of the goods. Acrylic Fibre produced by the

Domestic Industry is technically and commercially substitutable to the

imported Acrylic Fibre. The Authority proposes to hold that the product

under consideration produced by the applicant domestic industry is like

article to the subject product under consideration imported from the subject

countries. However, the Authority holds that “Homo Polymer Acrylic Fibre

containing 100% Acrylonitrile” should be excluded from the purview of the

product under consideration.

vii. No evidence has been adduced by any of the interested parties to show that

the domestic producers lag in production technology and are incapable of

producing speciality fibres. Therefore, it is not shown that possible injury to

the domestic industry could have been caused by developments in

technology.

viii. With regard to the claim concerning market economy status, Authority

notes that none of the exporters/producers from China PR has claimed

market economy status. Normal value for China PR has been constructed

considering optimum cost and consumption norms of the most efficient

constituent of the domestic industry plus reasonable profit in terms of the

provisions under the Anti-Dumping Rules and the consistent practice of the

Authority.

ix. With regard to the submission made by OJSC Naftan regarding their

dumping margin determination, the Authority notes that the dumping

margin for OJSC Naftan has been determined in accordance with the Anti-

Dumping Rules.

x. With regard to the submission made by Sudamericana de Fibras S.A for

determining individual dumping and injury margin for them, the Authority

notes that it is not possible for the Authority to determine individual

dumping and injury margin because of non-participation of all the parties

involved in export chain to India.

xi. With regard to the inclusion of Taiwan in the scope of investigation, the

Authority notes that no arguments have been advanced or evidence

Page 47 of 49

produced to show that imports of the product under consideration from

Taiwan are being dumped into India. Hence, there is no requirement to

include Taiwan within the scope of this investigation.

xii. As regards existence of injury due to increase in imports and decline in

demand, Authority observes that examination of injury involves

examination of all factors relevant under Annexure II of the Anti-dumping

Rules.

xiii. With regard to the submission that price undercutting should be determined

by considering only transactions whose landed price of imports is below the

selling price of the domestic industry, Authority observes that it is the

established practice of the Designated Authority that price undercutting

analysis is undertaken taking into account all the import transactions.

xiv. As regards the claim that NIP determined by the Authority should be

disclosed, Authority notes that detailed calculation of NIP was disclosed to

the domestic industry along with the disclosure statement.

xv. As regards the claim that verification report of the exporters/producers

should be disclosed, Authority notes that such verification reports contain

confidential information of the exporters and such report is not disclosed by

the Authority in any anti-dumping investigation.

xvi. With regard to confidentiality of information, Authority has examined the

confidentiality claims of the interested parties. The Authority has

considered the claims of confidentiality made by the petitioners and the

opposing interested parties and on being satisfied about the same, the

Authority has allowed the claim on confidentiality. The Authority had made

available to all interested parties the public file containing non-confidential

version of evidences submitted by various interested parties for inspection,

upon request as per Rule 6(7).

xvii. As regards the claim that disclosure statement should disclose conclusion

reached by the Authority on injury parameters, Authority notes that

disclosure statement is issued in accordance with Rule 16 of the Anti-

dumping rules by which it has informed all interested parties of the essential

facts under consideration which would form the basis of the final decision.

xviii. Authority has noted the submissions made by the domestic industry and

other interested parties with regard to injury in accordance with Anti-

dumping Rules. The Authority notes that profits, cash profits and return on

Page 48 of 49

capital employed of the domestic industry have substantially improved over

the injury period. Return on capital employed during the POI was as high as

in the range of 50%-60%. The selling price of the domestic industry for

subject goods during POI was significantly more than the NIP determined

by the Authority. The imports have had no suppressing effect on the

domestic selling price.

xix. The Authority further notes that even though there has been an increase in

the volume of dumped imports from the subject countries in absolute terms

and in relation to production and consumption in India, the landed price of

subject goods during POI from China PR, EU and Ukraine has been above

the NIP determined by the Authority for the domestic industry. Imports

from these three subject countries account for approximately 81% of the

total imports of subject goods from all the subject countries taken together.

Therefore, approximately 81% of the imports from all the subject countries

taken together cannot be said to be causing injury to the domestic industry.

xx. On a holistic analysis of all the injury parameters, it can be concluded that

the domestic industry is not suffering material injury as contemplated under

the Anti-Dumping Rules.

G.6. Conclusions on Injury

94. Considering various parameters relating to material injury provided under the

Anti-Dumping Rules, the Authority concludes as follows:

a. There has been an increase in the volume of dumped imports from the

subject countries in absolute terms and in relation to production and

consumption in India. Dumping margin from the subject countries is also

positive and significant. However, landed price of subject goods during POI

from China PR, EU and Ukraine has been above the NIP determined by the

Authority for the domestic industry. Imports of subject goods from these

three subject countries account for approximately 81% of the total imports

from all the subject countries taken together. Therefore, approximately 81%

of the imports from all the subject countries taken together cannot be said to

be causing injury to the domestic industry. The imports from subject

countries have also not caused any kind of price suppression for the

domestic industry.

b. The landed price of imports from subject countries has been above the cost

of sales of the domestic industry throughout the injury investigation period

and also during the POI.

Page 49 of 49

c. While capacity of the domestic industry has remained at the same level

during the injury period, the other parameters like production, capacity

utilization and market share of the domestic industry have followed a fixed

pattern of decrease and increase in alternate years.

d. Profits, cash profits and return on capital employed have substantially

improved over the injury period.

e. Return on capital employed during the POI was as high as in the range of

50%-60%.

f. The selling price of the domestic industry for subject goods during POI was

significantly more than the NIP determined by the Authority.

95. Based on the above, the Authority concludes that the domestic industry is not

suffering material injury during the POI in terms of the relevant provisions under

the Anti-Dumping Rules.

H. CAUSAL LINK AND OTHER FACTORS

96. As the Authority has concluded that the domestic industry is not suffering any

material injury during the POI, the Authority is not undertaking causal link and

non-attribution analysis.

I. RECOMMENDATION

97. Having examined the contentions of various interested parties and on the basis

of above facts, circumstances and analysis, the Authority concludes that the

domestic industry is not suffering material injury in terms of the provisions

enshrined under the Anti-Dumping Rules. In view of the above, the Authority does

not consider it appropriate to recommend levy of anti-dumping duty on the imports

of subject goods from subject countries and hereby terminates this investigation in

accordance with Rule 14(b) of the Anti-Dumping Rules.

J. FURTHER PROCEDURE

98. An appeal against the order of the Central Government that may arise out of

this Final Findings Notification shall lie before the Customs, Excise and Service

Tax Appellate Tribunal in accordance with the Customs Tariff Act.

(Sunil Kumar)

Additional Secretary & Designated Authority